Property investors push first home buyers off their perch.
Just a couple of months ago the first home owners grant extension wind-back could fence-sitting first time home buyers into the home ownership ranks in record numbers. They are now spent, but real estate property investors have overtaken first-home buyers. Life can be interesting as a mortgage broker.
The return of the property Investor
You might recall that the previous Government wanted more people into super and so made the offer so good, many people transferred their life savings into, and sold property to join the super rush. What a disaster for them. Many would have seen the net-worth halved in 12 months as the financial crisis unravelled.
The only good news is that house prices are still fairly flat, with the prestige end of the market down almost 40% and mortgage rates at record lows, and rents increasing, property must be looking a lot better than when they left the housing market for the stock market.
Property is, and always has been, a solid long-term investment, but maybe not the bonanza it can be right at this point in time.
So if you are thinking of buying a property as an investor, take your time and shop around, and negotiate on price.
The other piece of advise that is worth repeating is to take a mid term view to realise a profit [at least 5 years.]
Because interest rates are at all time lows, lock in a fixed rate for 5 to 7 years. This will insulate you against rising interest rates predicted over the next 12 months.
And you should take a liquid position by having cash in reserve should you get a dry spell in occupancy rates.
The good news for property investors is that there is a chronic shortage of housing stock that will take years to overcome, and banks have tightened credit and loan to value ratios, making it harder for people with no savings to a get a mortgage. So renters will have to stay renting longer. That can only make housing stock scarcer.
Just a couple of months ago first home owners grant extension wind-back caused fence-sitting first time home buyers into the home ownership ranks in record numbers. Real estate property investors now out borrow them.
The return of the property Investor
You might recall that the previous Government wanted more people into super and so made the offer so good, many people transferred their life savings into, and sold property to join the super rush. What a disaster for them. Many would have seen the net-worth halved in 12 months as the financial crisis unravelled.
The only good news is that house prices are still fairly flat, with the prestige end of the market down almost 40% and mortgage rates at record lows, and rents increasing, property must be looking a lot better than when they left the housing market for the stock market.
Real Estate Property is a great long term investment
Property is, and always has been, a solid long-term investment, but maybe not the bonanza it can be right at this point in time.
So if you are thinking of buying a property as an investor, take your time and shop around, and negotiate on price, and buy wel located homes in good suburbs.
The other piece of advise that is worth repeating is to take a mid term view to realise a profit [at least 5 years.]
Because interest rates are at all time lows, lock in a fixed rate for 5 to 7 years. This will insulate you against rising interest rates predicted over the next 12 months.
And you should take a liquid position by having cash in reserve should you get a dry spell in occupancy rates.
So renters will have to stay renting longer. That can only make housing stock scarcer, and drive rents higher.
Remember that people will always need a roof over their heads.
Tags: Buying A Property, Chronic Shortage, Dry Spell, first home buyers, first home owners grant, First time home buyers, Home Owners Grant, Long Term Investment, Mortgage Broker, Mortgage Rates, Occupancy Rates, Property Investor, Property Investors, Real Estate, Record Lows, Record Numbers, Rising Interest Rates, Shortage Of Housing, Time Home Buyers, Time Lows, Value Ratios
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